KIC's First-Ever Union Opposes "Unilateral Relocation to the Provinces"

Concerns that political and regional interests could undermine operational independence

For the first time in more than 20 years since the launch of Korea Investment Corporation (KIC), the sovereign wealth fund, a labor union has been established. The KIC union's first rallying cry is opposition to a "unilateral headquarters relocation." It says the matter should be decided carefully based not on political interests, but on an objective assessment of its impact and consultations among all stakeholders.

The KIC union made the remarks in its first statement since its establishment on October 13. The union emphasized, "We do not reject the government's policy goals of easing overcrowding in the Seoul metropolitan area and promoting balanced national development. However, we clearly oppose attempts to relocate the sovereign wealth fund's headquarters without sufficient review and based on considerations unrelated to operational needs."

The KIC union questioned the rationale for relocating an organization whose purpose of overseas investment is clear. The union said, "Overseas investment is a network-based industry in which capital, information, experts, asset managers, and legal and accounting services are in constant contact. Accordingly, most of the world's leading sovereign wealth funds, including Norway's NBIM and Singapore's GIC, are located in capitals or financial centers." It criticized the proposal, saying, "With Seoul having climbed to a record-high seventh place in the 40th Global Financial Centres Index (GFCI), relocating the corporation would mean dismantling the financial agglomeration benefits that have been painstakingly built up."

The union expressed particular concern that the fund's operational independence could be undermined by short-term policy outcomes or political and regional interests. The KIC union said, "The independence and autonomy of asset management were guaranteed when the Korea Investment Corporation Act was enacted for this very reason." It warned, "If a precedent is set in which the headquarters' location is changed by an external decision unrelated to operational needs, the impact will extend beyond organizational management and undermine confidence in the independence of investment decisions."

The KIC union called for an end to the unilateral push to relocate the headquarters and for a thorough assessment of the effects of a move. It says the impact on the country's sovereign wealth management capabilities, operational independence, financial competitiveness, and employee retention should be assessed objectively. It also urged KIC to consider alternatives to physical relocation that would allow the corporation to contribute to balanced regional development, while ensuring meaningful consultations among labor, management, and the government throughout the process.

Earlier, in political circles, Democratic Party of Korea lawmaker Lee Sung-yoon sponsored a bill to amend the Korea Investment Corporation Act to place KIC's headquarters in Jeonbuk State. The proposal is part of the so-called "Five-Bill Package to Make Jeonbuk the Country's Third Financial Center," which would also relocate the main offices of the Korea Deposit Insurance Corporation, the National Credit Union Federation of Korea, Korea Venture Investment Corp., and the Bank of Korea.

The government is also working on the second phase of relocating public institutions outside the Seoul metropolitan area. On October 3, the Ministry of Land, Infrastructure and Transport announced five principles, including minimizing the number of institutions that remain in the Seoul metropolitan area. It said it would finalize the relocation plan in the fourth quarter of this year and begin relocating leading institutions in 2027. KIC has not yet been confirmed as a relocation target, but it continues to be mentioned as a possibility.

The KIC union was established amid this climate. Formed for the first time since KIC's establishment in 2005, the union has won internal support, with about 85% of eligible employees joining.

This content was produced with the assistance of AI translation services.